87-9180 IRB Presbyterian ManorHINKLE, EBERHART, ELKOURI & JENSEN
1
ORDINANCE NO. 87-9180
of the
CITY OF SALINA, KANSAS
u
Authorizing the Issuance of
$800,000 Industrial Revenue Bonds
Series 1987
(Salina Presbyterian Manor, Inc.)
DATED AS OF APRIL 1, 1987
1
(Published in The Salina Journal, ���^/� �J� 1987)
ORDINANCE NO. 87-9180
AN ORDINANCE SUPPLEMENTING ORDINANCE
NO. 8639 OF THE CITY OF SALINA,
KANSAS, AND AUTHORIZING' THE CITY TO
PURCHASE, CONSTRUCT AND EQUIP CERTAIN
BUILDINGS, IMPROVEMENTS, MACHINERY
AND EQUIPMENT AS AN ADDITION TO A
FACILITY ON LAND PREVIOUSLY ACQUIRED
BY THE CITY AND LEASED TO SALINA
PRESBYTERIAN MANOR, INC.; AUTHORIZING
AND DIRECTING THE ISSUANCE OF
$800,000 PRINCIPAL AMOUNT OF
INDUSTRIAL REVENUE BONDS, SERIES 1987
OF SAID CITY FOR THE PURPOSE OF
PROVIDING FUNDS TO PAY THE COST OF
PURCHASING, CONSTRUCTING AND
EQUIPPING SAID ADDITION; PRESCRIBING
THE FORM AND AUTHORIZING THE
EXECUTION OF A SUPPLEMENTAL LEASE BY
AND BETWEEN SAID CITY AND SALINA
PRESBYTERIAN MANOR, INC.; AND
PRESCRIBING THE FORM AND REQUIRING
THE EXECUTION OF A SEPARATE GUARANTY
AGREEMENT BY UNITED PRESBYTERIAN
FOUNDATION OF KANSAS, INC. AND SALINA
PRESBYTERIAN MANOR, INC., AS
GUARANTORS.
WHEREAS, the City of Salina, Kansas, a city of the
rst class, hereinafter sometimes referred to as the "City",
sires to promote, stimulate and develop the general economic
lfare and prosperity of the City of Salina, Kansas, and its
virons and thereby to further promote, stimulate and develop
e general economic welfare and prosperity of the State of
nsas; and
WHEREAS, the City of Salina, Kansas, by Ordinance No.
639 authorized the City to acquire a tract of land in Salina,
ansas, for commercial purposes, and authorized the payment of
he cost of acquiring such land and purchasing, constructing
nd equipping thereon a commercial facility, and further
uthorized and directed the issuance of $2,000,000 principal
mount Industrial Revenue Bonds of the City to pay such costs
hereinafter sometimes called the "1978 Bonds"); and further
uthorized the execution of a Lease between the City, as
andlord, and Salina Presbyterian Manor, Inc., a Kansas
ot—for—profit corporation, as Tenant, (which Lease, as
upplemented by the Supplemental Lease hereafter referenced,
s hereafter sometimes called the "Lease"); and
WHEREAS, the City of Salina, Kansas did enter into
such Lease, did acquire such tract of land, did issue the 1978
WHEREAS, pursuant to the provision of K.S.A. 12-1740
0 12+1749a, as amended (hereinafter referred to as the
Act")° said City is authorized to issue Industrial Revenue
onds of the City, and it is hereby found and determined. to be
dvisable and in the interest and for the welfare of the City
nd its inhabitants that Industrial Revenue Bonds of the City
n the principal amount of $800,000 be authorized and issued,
or the purpose of providing funds to pay the balance of the
forementioned costs.
NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY
F THE CITY OF SALINA, KANSAS:
SECTION 1: Description of Facility. As used herein,
he term "Facility" shall include the original facility
financed by the 1978 Bonds and the Bonds hereinafter
uthorized. The additions financed with the proceeds of the
onds are further described in Schedule I attached hereto and
ncorporated herein by reference.
SECTION 2: Authorization of and Security for the
onds . For the purpose of providing funds to pay the cost of
cquiring, constructing and equipping certain additions to the
orementioned facility, there shall be issued and hereby are
uthorized and directed to be issued Industrial Revenue Bonds,
eries 1987, of the City of Salina, Kansas, in the principal
mount of $800,000 (hereinafter sometimes referred to as the
Bonds"). The Bonds and all interest thereon shall be paid
lolely from the money and revenue received from the fees
harged and rental received for the use of the Facility and
ot from any other fund or source (except to the extent paid
ut of the moneys attributable to Bond proceeds or the income
rom the temporary investment thereof and, under certain
ircumstances as hereinafter and in the Lease provided,
roceeds of insurance, sale and condemnation awards) and the
ity ,hereby pledges the Facility and the net earnings
herefrom to the payment of the Bonds, the. 1978 Bonds, and the
nterest thereon. The Bonds shall be equal in priority and
ien to the 1978 Bonds.
SECTION 3. Description and Details of the Bonds,
lesiqnation of Paying Agent. The Bonds shall be dated April
1987, and shall be issued as fully registered Bonds in
ncrements of $5,000 or any multiples thereof. Said Bonds
hall become due on June 1 in each of the following years and
hall bear interest from date at the respective rates as
ollows:
-2-
'�"
onds and did
purchase,
construct and equip
thereon
such
acility; and
WHEREAS,
Ordinance
No. 8639 authorized
the issuance
f additional bonds
to be
on a parity with and
co -equal
with
he outstanding
1978 Bonds
upon certain conditions;
and
the
ity finds that
such specified conditions have
been and
will
e met; and
WHEREAS, pursuant to the provision of K.S.A. 12-1740
0 12+1749a, as amended (hereinafter referred to as the
Act")° said City is authorized to issue Industrial Revenue
onds of the City, and it is hereby found and determined. to be
dvisable and in the interest and for the welfare of the City
nd its inhabitants that Industrial Revenue Bonds of the City
n the principal amount of $800,000 be authorized and issued,
or the purpose of providing funds to pay the balance of the
forementioned costs.
NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY
F THE CITY OF SALINA, KANSAS:
SECTION 1: Description of Facility. As used herein,
he term "Facility" shall include the original facility
financed by the 1978 Bonds and the Bonds hereinafter
uthorized. The additions financed with the proceeds of the
onds are further described in Schedule I attached hereto and
ncorporated herein by reference.
SECTION 2: Authorization of and Security for the
onds . For the purpose of providing funds to pay the cost of
cquiring, constructing and equipping certain additions to the
orementioned facility, there shall be issued and hereby are
uthorized and directed to be issued Industrial Revenue Bonds,
eries 1987, of the City of Salina, Kansas, in the principal
mount of $800,000 (hereinafter sometimes referred to as the
Bonds"). The Bonds and all interest thereon shall be paid
lolely from the money and revenue received from the fees
harged and rental received for the use of the Facility and
ot from any other fund or source (except to the extent paid
ut of the moneys attributable to Bond proceeds or the income
rom the temporary investment thereof and, under certain
ircumstances as hereinafter and in the Lease provided,
roceeds of insurance, sale and condemnation awards) and the
ity ,hereby pledges the Facility and the net earnings
herefrom to the payment of the Bonds, the. 1978 Bonds, and the
nterest thereon. The Bonds shall be equal in priority and
ien to the 1978 Bonds.
SECTION 3. Description and Details of the Bonds,
lesiqnation of Paying Agent. The Bonds shall be dated April
1987, and shall be issued as fully registered Bonds in
ncrements of $5,000 or any multiples thereof. Said Bonds
hall become due on June 1 in each of the following years and
hall bear interest from date at the respective rates as
ollows:
-2-
'�"
TERM BONDS
2002 165,000 8.00%
2008 375,000 8.25%
The Bonds shall bear interest from their date payable
ecember 1, 1987 and thereafter semiannually on each June 1 and
ecember 1 (the "Interest Payment Dates").
The Bonds shall bear interest from their effective
ate of registration on the Interest Payment Dates in each year
o the registered owner thereof as shown on the books of the
fiscal Agent on November 15 or May 15, as the case may be, (the
Record Date") next preceding such Interest Payment Date. The
ffective date of registration shall be set forth on each such
ond, such effective date of registration to be as of the
nterest Payment Date next preceding the date of authentication
hereof by the Fiscal Agent, unless such date of authentication
hall be an Interest Payment Date, in which case the effective
ate of registration shall be as of such date of
uthentication, or unless the date of authentication shall be
rior to the first Interest Payment Date, in which case the
ffective date of registration shall be the date of the Bonds;
rovided, however, that if payment of the interest on the Bonds
hall be in default at the time of authentication of any Bonds
ssued in lieu of Bonds surrendered for transfer or exchange,
he effective date of registration shall be as of the date to
hick interest has been paid in full on the Bonds surrendered.
Maturity
SERIAL BONDS
Principal
Interest
shall
June 1
Amount
Rate
to the registered
1989
$ 20,000
5.90%
awful money of the United
1990
20,000
6.00%
1991
20,000
6.25%
bank
1992
25,000
6.50%
agent
1993
25,000
6.70"6
gent for the payment of
1994
25,000
6.80,6
the
1995
30,000
6.90%
the
1996
30,000
7.00%
1997
30,000
7.15%
1998
35,000
7.25%
TERM BONDS
2002 165,000 8.00%
2008 375,000 8.25%
The Bonds shall bear interest from their date payable
ecember 1, 1987 and thereafter semiannually on each June 1 and
ecember 1 (the "Interest Payment Dates").
The Bonds shall bear interest from their effective
ate of registration on the Interest Payment Dates in each year
o the registered owner thereof as shown on the books of the
fiscal Agent on November 15 or May 15, as the case may be, (the
Record Date") next preceding such Interest Payment Date. The
ffective date of registration shall be set forth on each such
ond, such effective date of registration to be as of the
nterest Payment Date next preceding the date of authentication
hereof by the Fiscal Agent, unless such date of authentication
hall be an Interest Payment Date, in which case the effective
ate of registration shall be as of such date of
uthentication, or unless the date of authentication shall be
rior to the first Interest Payment Date, in which case the
ffective date of registration shall be the date of the Bonds;
rovided, however, that if payment of the interest on the Bonds
hall be in default at the time of authentication of any Bonds
ssued in lieu of Bonds surrendered for transfer or exchange,
he effective date of registration shall be as of the date to
hick interest has been paid in full on the Bonds surrendered.
-3-
_ I - - ,"mr
Principal of and
interest on the
Bonds
shall
be
ayable by check or draft
to the registered
owner
thereof in
awful money of the United
States of America paid by
First
Bank
nd Trust Company, in the
City of Salina, Kansas,
such
bank
eing hereby designated as
the City's fiscal
agent
and paying
gent for the payment of
the principal of and
interest
on
the
onds herein authorized and sometimes referred
to herein as
the
Fiscal Agent" and "Paying
Agent".
-3-
_ I - - ,"mr
The Bonds shall be subject to redemption and payment
rior to the stated maturity thereof only as provided in
ection 4 of this Ordinance.
SECTION 4. Redemption and Payment of Bond Prior to
aturi.t . The Bonds shall be subject to redemption and payment
rior to the stated maturity thereof, as follows:
(a) Extraordinary Optional Redemption. In the event
f a Change in Circumstances, the Bonds shall be subject to
edemption and payment prior to the stated maturity thereof, at
he option of the City, upon instructions from the Tenant, on
ny date at a redemption price equal to the par value of the
rincipal amount thereof, plus accrued interest thereon to the
edemption date, without premium, provided all of the Bonds are
o redeemed and paid according to their terms.
(b) Optional Redemption. The Bonds, maturing in the
ear 1997 and thereafter shall be subject to redemption and
ayment prior to maturity, at the option of the City, upon
nstructions from the Tenant, on and after June 1, 1996, as a
hole at any time, or in part on any Interest Payment Date, at
he respective redemption prices (expressed as percentages of
rincipal amount) set forth below, plus accrued interest
hereon to the date fixed for redemption and payment:
(c) Sinking Fund Redemption.
Each of said Bonds maturing on June 1, 2002, shall be
ubject to mandatory redemption and payment from the sinking
and hereafter described on June 1, 1999, or on June 1 of any
ear thereafter pursuant to the redemption schedule hereafter
et out, at the principal amount thereof, plus accrued interest
hereon to date fixed for redemption and payment, without
remium.
As and for a sinking fund for the retirement of the
onds maturing June 1, 2002, but subject to the provisions of
he next paragraph of this Section, the rent payments specified
Ln the Supplemental Lease which are to be deposited in the
rincipal and Interest Payment Account created by Ordinance No.
639 commencing on June 1, 1998, (the "Sinking Fund Deposits"),
hall be sufficient to redeem (after credit as hereinafter
rovided) and the City hereby agrees to redeem the following
—4—
'
Redemption
Dates
Redemption
(Both
Inclusive)
Prices
une
1,
1996
to
May
31, 1997
103%
une
1,
1997
to
May
31, 1998
102 1/2%
une
1,
1988
to
May
31, 1999
102%
une
1,
1999
to
May
31, 2000
101 1/2%
une
1,
2000
to
May
31, 2001
101%
une
1,
2001
to
May
31, 2002
100 1/2%
une
1,
2002
and
thereafter
100%
(c) Sinking Fund Redemption.
Each of said Bonds maturing on June 1, 2002, shall be
ubject to mandatory redemption and payment from the sinking
and hereafter described on June 1, 1999, or on June 1 of any
ear thereafter pursuant to the redemption schedule hereafter
et out, at the principal amount thereof, plus accrued interest
hereon to date fixed for redemption and payment, without
remium.
As and for a sinking fund for the retirement of the
onds maturing June 1, 2002, but subject to the provisions of
he next paragraph of this Section, the rent payments specified
Ln the Supplemental Lease which are to be deposited in the
rincipal and Interest Payment Account created by Ordinance No.
639 commencing on June 1, 1998, (the "Sinking Fund Deposits"),
hall be sufficient to redeem (after credit as hereinafter
rovided) and the City hereby agrees to redeem the following
—4—
incipal amounts of Bonds maturing June 1, 2002, on June 1 in
ch of the following years:
YEAR PRINCIPAL AMOUNT
1999 $ 35,000
2000 40,000
2001 45,000
(Leaving $45,000 to mature June 1, 2002)
Each of said Bonds maturing on June 1, 2008, shall be
bject to mandatory redemption and payment from the sinking
nd hereafter described on June 1, 2003, or on June 1 of any
ar thereafter pursuant to the redemption schedule hereafter
t out, at the principal amount thereof, plus accrued interest
ereon to date fixed for redemption and payment, without
emium.
As and for a sinking fund for the retirement of the
nds maturing June 1, 2008, but subject to the provisions of
he next paragraph of this Section, the rent payments specified
n the Supplemental Lease which are to be deposited in the
rincipal and Interest Payment Account created by Ordinance No.
639 commencing on June 1, 2003, (the "Sinking Fund Deposits"),
hall be sufficient to redeem (after credit as hereinafter
rovided) and the City hereby agrees to redeem the following
rincipal amounts of Bonds maturing June 1, 2008, on June 1 in
ach of the following years:
YEAR PRINCIPAL AMOUNT
2003 $ 50,000
2004 55,000
2005 60,000
i 2006 65,000
2007 70,000
(Leaving $75,000 to mature June 1, 2008)
he Bonds maturing on June 1, 2002 and June 1, 2008, to be
edeemed and paid pursuant to the operation of the Sinking Fund
hall be selected by lot by the Fiscal Agent in such equitable
anner as it may designate. The Fiscal Agent shall each year
n which the Bonds are to be redeemed pursuant to the terms of
aid Sinking Fund make timely selection of Bonds to be so
edeemed and shall give notice thereof as provided in this
rdinance without further instructions from the City or the
enant.
rom the Tenant use moneys on hand in the Principal and
nterest Payment Account to purchase Bonds maturing on June 1,
002 or June 1, 2008, respectively, in the open market at a
—5—
The Fiscal Agent may, at any
time
after June 1, 1998,
n the case of Bonds maturing in 2002
and
on or after June 1,
003 in the case of Bonds maturing in
2008,
upon instructions
rom the Tenant use moneys on hand in the Principal and
nterest Payment Account to purchase Bonds maturing on June 1,
002 or June 1, 2008, respectively, in the open market at a
—5—
rice not in excess of the then applicable redemption price
pecified above in subsection (b) of this Section and each
and so purchased shall be credited at 100% of the principal
mount thereof on the obligation of the City on the next
inking Fund redemption date for such Bonds and the principal
mount of Bonds to be redeemed by operation of the Sinking
and shall be reduced accordingly.
At its option, to be exercised: (a) with respect to
he Bonds maturing June 1, 2002, on or before the Forty—fifth
45th) day next preceding any June 1 in the years 1998 to
001, inclusive or with respect to the Bonds maturing June 1,
008, on or befor tghe Forty—fifth (45th) day next preceding
ny June 1 in the years 2002 to 2007, inclusive, the City or
he Tenant may: (i) deliver to the Fiscal Agent for
ancellation, any of such Bonds maturing on June 1, 2002 or
une 1, 2008, as the case may be, in any aggregate principal
mount desired; or (ii) furnish the Fiscal Agent with funds
ogether with appropriate instructions, for the purpose of
urchasing any of said Bonds maturing on June 1, 2002 or June
2008, from any owner thereof whereupon said Fiscal Agent
hall expend such funds for such purpose to such extent as may
e practical; or (iii) receive a credit in. respect to the
inking Fund obligation of the City under the second preceding
aragraph of this Section for any Bonds maturing on June 1,
002 or June 1, 2008, as the case may be, which prior to such
ates have been redeemed (other than through the operation of
he Sinking Fund requirements of the second preceding
aragraph) and cancelled by the Fiscal Agent and not
heretofore applied as a credit against any redemption
bligation under said paragraph. Each Bond maturing on June
2002 or June 1, 2008, as the case may be, so delivered or
urchased or previously redeemed shall be credited at 100% of
he principal amount thereof on the obligation of the issuer
n such redemption date, and any excess of such amount shall
e credited on future Sinking Fund obligations for such Series
onds in chronological order and the principal amount of Bonds
o be redeemed by operation of the Sinking Fund shall be
ccordingly reduced.
If the City or the Tenant intends to exercise the
ption granted by the provisions of sub—provisions (i), (ii)
r (iii) of the next preceding paragraph, the City or the
enant will on or before the Forty—fifth (45th) day next
receding each June 1 in the years from 1998 to 2003,
nclusive, with respect to the Bonds maturing June 1, 2004,
nd on or before the Forty—fifth (45th) day next preceding
ach June 1 in the years from 2002 to 2007, inclusive, with
espect to the Bonds maturing June 1, 2008, inclusive, furnish
he Fiscal Agent with a certificate signed by its President or
n appropriate officer of the Tenant indicating to what extent
he provisions of said sub—provisions (i), (ii) and (iii) are
o be complied with in respect to such Sinking Fund payment.
SECTION 5. Notice of Redemption. Notice of the call
or any redemption provided for by this Ordinance shall be
!M
iven by registered or certified mail to the registered owner
hereof at the address shown on the registration books of the
fiscal Agent not less than Thirty (30) days prior to the
ademption date; provided, however, that failure to give such
otice by mailing as aforesaid, or any defect therein, shall
of affect the validity of any proceedings for the redemption
f the Bonds.
The City, the Fiscal Agent and Tenant may deem and
reat the person in whose name a Bond is registered as the
bsolute owner- of such Bond, whether such Bond shall be
verdue or not, for the purpose of receiving payment of, or on
ccount of, the principal of and interest and redemption
remium, if any, on such Bond and for all other purposes, and
11 such payments so made to such registered owner or upon his
rder shall be valid and effectual to satify and discharge the
iability upon such Bond to the extent of the sum or sums
o6paid, and neither the City, nor the Fiscal Agent nor Tenant
hall be affected by any notice to the contrary, but such
egistration may be changed as herein provided. Neither the
ity nor the Fiscal Agent shall be required to make any such
xchange or transfer of Bonds on or after the Record Date
recedinga payment date on the Bonds or, in the case of any
roposed redemption of Bonds, during the 15 days immediately
receding the selection of Bonds for such redemption or after
uch Bonds or any portion thereof has been selected for
edemption.
—7—
SECTION 6. Mutilated, Lost, Stolen or Destroued
onds. In the event any Bond shall become mutilated, or be
ost, stolen or destroyed, the City shall execute and the
fiscal Agent shall authenticate and deliver a new Bond of like
eries, date and tenor as the Bond mutilated, lost, stolen or
estroyed. Provided that, in the case of any mutilated Bond,
uch mutilated Bond shall first be surrendered to the Fiscal
gent, and in the case of any lost, stolen or destroyed Bond,
here shall be first furnished to the City and the Fiscal
gent evidence of such loss, theft or destruction satisfactory
o the City and the Fiscal Agent, together with indemnity
atisfactory to them. In the event any such Bond shall have
atured, instead of issuing a substitute Bond the City may pay
r authorize the payment of the same without surrender
hereof. Upon the issuance of any substitute Bond, the City
nd the Fiscal Agent may require the payment of an amount
ufficient to reimburse the City and the Fiscal Agent for any
ax or other governmental charge that may be imposed in
elation thereto and any other reasonable fees and expenses
ncurred in connection therewith.
SECTION 7. Registration Provisions, Persons Treated
s Owner. The City covenants that it will, so long as the
onds remain outstanding, keep at the office of the Fiscal
gent books for the registration of the Bonds as herein
rovided. The principal of and interest on the Bonds shall be
ade payable only to the registered owner, as shown on the
egistration books. The Bonds may not be registered to bearer.
The City, the Fiscal Agent and Tenant may deem and
reat the person in whose name a Bond is registered as the
bsolute owner- of such Bond, whether such Bond shall be
verdue or not, for the purpose of receiving payment of, or on
ccount of, the principal of and interest and redemption
remium, if any, on such Bond and for all other purposes, and
11 such payments so made to such registered owner or upon his
rder shall be valid and effectual to satify and discharge the
iability upon such Bond to the extent of the sum or sums
o6paid, and neither the City, nor the Fiscal Agent nor Tenant
hall be affected by any notice to the contrary, but such
egistration may be changed as herein provided. Neither the
ity nor the Fiscal Agent shall be required to make any such
xchange or transfer of Bonds on or after the Record Date
recedinga payment date on the Bonds or, in the case of any
roposed redemption of Bonds, during the 15 days immediately
receding the selection of Bonds for such redemption or after
uch Bonds or any portion thereof has been selected for
edemption.
—7—
1
1
SECTION 8. Method of Execution and Authentication of
onds. The Bonds shall be executed for and on behalf of the
ity by the manual or facsimile signature of the Mayor,
ttested by the manual or facsimile signature of the City
lerk and the seal of said City shall be affixed thereto or
mprinted thereon. In the event either said Mayor or City
lerk or both of said officers shall cease to hold such office
efore the Bonds bearing their signatures shall have been
ssued and delivered, the Bonds may be issued and delivered as
hough said officers had not ceased to hold office and such
ignatures appearing on the Bonds shall be valid and
ufficient for all purposes as if they had remained in office
ntil such issuance.
The Bonds shall not be a valid obligation under the
rovisions of this Ordinance until authenticated by the Fiscal
gent by the execution of an appropriate certificate appearing
n such Bonds.
SECTION 9. Form of Bonds. The Bonds and the
ertificates relating thereto shall be in substantially the
ollowing form:
ME
fJ
1
FACE OF THE BOND
H
United States of America
State of Kansas
11 City of Salina, Kansas
Industrial Revenue Bond
Series 1987
(Salina Presbyterian Manor, Inc.)
ate of Maturity Dated
nterest: Date: June 1, Date: April. 1, 1987 CUSIP:
Registered Owner:
Principal Amount: Dollars
The City of Salina, Kansas, a municipal corporation of
he State of Kansas (the "City"), for value received, promises to
ay, but solely from the sources hereinafter referred to, to the
egistered owner identified above, or registered assigns, upon
he presentation and surrender of this Bond, the principal sum
dentified above on the maturity date shown, in any coin or
urrency of the United States of America which on the date of
ayment thereof is legal tender for the payment of public and
rivate debts, at the principal offices of First Bank and Trust
ompany, in the City of Salina, Kansas (the "Paying Agent" and
Fiscal Agent"), and in like manner to pay to the registered
caner ("Owner") hereof, by check or draft mailed to the Owner at
is address as it appears on the bond registration books of the
ity kept by the Fiscal Agent under the within mentioned
rdinance, interest on said principal sum from the effective date
f registration of this Bond (which date is set forth on this
ond) at the rate of interest shown above per annum payable
emiannually on December 1 and June 1 in each year, commencing on
ecember 1, 1987, until said principal sum is paid.
Reference is hereby made to the further provisions of
his Series 1987 Bond set forth on the reverse side hereof and
uch further provisions shall for all purposes have the same
ffect as if set forth on the face hereof.
It is hereby certified and declared that all acts,
onditions and things required to exist, happen and be performed
recedent to and in the execution and delivery of the Bond
rdinance hereinafter described and the issuance of this Bond do
xist, have happened and have been, performed in due time, form
nd manner as required by law.
Wz
v
IN WITNESS WHEREOF, City has caused
this Bond
to be
xecuted in its name by the
ayor and attested by the
manual or facsimile
manual or facsimile
signature
signature
of the
of its
ity Clerk and its official
seal to be affixed
hereto or
mprinted hereon, and has
caused this Bond to
be dated
as of
pril 1, 1987.
i
City of Salina,
Kansas
f
Facsimile Seal)
By (facsimile
signature
Joseph M. Ritter, Mayor
TTEST:
facsimile signature)
1.
L. Harrison, City Clerk
—10—
1
11
■
(FORM OF FISCAL AGENT'S CERTIFICATE OF AUTHENTICATION)
This Bond is one of the City of Salina, Kansas,
Industrial Revenue Bonds, Series 1987 (Salina Presbyterian
anor, Inc.), described in the within—mentioned Ordinance. The
effective date of registration of this Bond is
First Bank and Trust Company,
Salina, Kansas, as Fiscal Agent
By
Authorized Officer
= xxx x x = x xa = x x =a x a aaa as aaaa xx x= =xxaa a as a:aaa a s sa sas= xxxa = aaaaa
—11—
REVERSE OF THE BOND
This Bond is one of a duly authorized series of Bonds
f the City designated "City of Salina, Kansas, Industrial
Revenue Bonds, Series 1987 (Salina Presbyterian Manor, Inc.)",
n the aggregate principal amount of $800,000 (the "Bonds"),
issued for the purpose of providing funds to pay the cost of
purchasing, constructing and installing certain facilities
hich, together with the buildings, improvements, machinery and
equipment described in Ordinance No. 8639 of the City,
onstitutes the "Facility" to be leased by the City to Salina
resbyterian Manor, Inc., a Kansas not—for—profit corporation
the "Tenant"), under the terms of a Lease Agreement dated as
f June 1, 1978, as supplemented by a Supplemental Lease dated
s of April 1, 1987, (the "Supplemental Lease") each between
he City and the Tenant (said Lease and Supplemental Lease, as
mended and supplemented from time to time in accordance with
he provisions thereof, being herein -called the "Lease"), all
ursuant to the authority of and in conformity with the
rovisions, restrictions and limitations of the Constitution
nd statutes of the State of Kansas, including particularly
.S.A. 12-1740 to 12-1749a, inclusive, as amended, and pursuant
o proceedings duly had by the governing body of the City.
This Bond does not constitute a debt of said City
ithin the meaning of any constitutional or statutory
imitation. Reference is hereby made to the Ordinance of the
ity authorizing the issuance of the Bonds (the "Bond
rdinance"), Ordinance No. 8639 of the City and to the Lease
or a description of the covenants of the City with respect to
he collection, segregation and application of the money and
avenue received from the fees charged and rental received for
he use of the Facility, the rights, duties and obligations of
he City and the Tenant with respect thereto, the right of the
ity to issue additional Bonds and the rights of the registered
caner of this Bond.
The Bonds are equal in priority and on a parity with
The
he City of Salina, Kansas Industrial Revenue Bonds, Series
to redemption and payment
une 1, 1978 (Salina Presbyterian Manor, Inc.) in the aggregate
rincipal amount of $2,000,000 (the "1978 Bonds").
stated maturity thereof,
The Tenant and United Presbyterian Foundation of
ansas have entered into a separate Guaranty Agreement with the
(a)
fiscal Agent whereby Tenant and United Presbyterian Foundation
Redemption. In the event
f Kansas have unconditionally guaranteed, for the benefit of
he registered owners of the Bonds, the full and prompt payment
in Circumstances, the
f the principal of and interest and redemption premium, if
ny, on the Series 1987 Bonds when and as the same become due
nd payable in accordance with its terms.
This Bond does not constitute a debt of said City
ithin the meaning of any constitutional or statutory
imitation. Reference is hereby made to the Ordinance of the
ity authorizing the issuance of the Bonds (the "Bond
rdinance"), Ordinance No. 8639 of the City and to the Lease
or a description of the covenants of the City with respect to
he collection, segregation and application of the money and
avenue received from the fees charged and rental received for
he use of the Facility, the rights, duties and obligations of
he City and the Tenant with respect thereto, the right of the
ity to issue additional Bonds and the rights of the registered
caner of this Bond.
—12—
The
Bonds shall be subject
to redemption and payment
rior to the
stated maturity thereof,
as follows:
(a)
Extraordinary Optional
Redemption. In the event
f a Change
in Circumstances, the
Bonds shall be subject to
—12—
rJedemption and payment prior to the stated maturity thereof, at
he option of the City, upon instructions from the Tenant, on
ny date at a redemption price equal to the par value of the
rincipal amount thereof, plus accrued interest thereon to the
ademption date, without premium, provided all of the Bonds are
o redeemed and paid according to their terms.
(b) Optional Redemption. The Bonds, maturing in the
ear 1997 and thereafter shall be subject to redemption and
ayment prior to maturity, at the option of the City, upon
nstructions from the Tenant, on and after June 1, 1996, as a
hole at any time, or in part on any Interest Payment Date, at
he respective redemption prices (expressed as percentages of
rincipal amount) set forth below, plus accrued interest
hereon to the date fixed for redemption and payment:
Redemption Dates Redemption
(Both Inclusive) Prices
une
1,
1996
to
May
31,
1997
103%
une
1,
1997
to
May
31,
1998
102 1/2%
une
1,
1988
to
May
31,
1999
102%
une
1,
1999
to
May
31,
2000
101 1/2%
une
1,
2000
to
May
31,
2001
101%
une
1,
2001
to
May
31,
2002
100 1/2%
une
1,
2002
and thereafter
100%
As and for a sinking fund for the retirement of the
onds maturing June 1, 2002, but subject to the provisions of
he next paragraph of this Section, the rent payments specified
n the Supplemental Lease which are to be deposited in the
rincipal and Interest Payment Account commencing on June 1,
998, (the "Sinking Fund Deposits"), shall be sufficient to
edeem (after credit as hereinafter provided) and the City
ereby agrees to redeem the following principal amounts of
onds maturing June 1, 2002, on June 1 in each of the following
ears:
YEAR PRINCIPAL AMOUNT
1999 $ 35,000
2000 40,000
2001 45,000
(Leaving $45,000 to mature June 1, 2002)
-13-
(c) Sinking Fund Redemption.
Each of said Bonds maturing
on June
1, 2002,
shall be
ubject to mandatory redemption
and payment
from the
sinking
and hereafter described on June
1, 1999, or
on June
1 of any
ear thereafter pursuant to the
redemption schedule hereafter
et out, at the principal amount
thereof, plus
accrued
interest
�hereon
to date fixed for redemption and
payment,
without
remium.
As and for a sinking fund for the retirement of the
onds maturing June 1, 2002, but subject to the provisions of
he next paragraph of this Section, the rent payments specified
n the Supplemental Lease which are to be deposited in the
rincipal and Interest Payment Account commencing on June 1,
998, (the "Sinking Fund Deposits"), shall be sufficient to
edeem (after credit as hereinafter provided) and the City
ereby agrees to redeem the following principal amounts of
onds maturing June 1, 2002, on June 1 in each of the following
ears:
YEAR PRINCIPAL AMOUNT
1999 $ 35,000
2000 40,000
2001 45,000
(Leaving $45,000 to mature June 1, 2002)
-13-
1
1
Each of said Bonds maturing on June 1, 2008, shall be
;ubject to mandatory redemption and payment from the sinking
und hereafter described on June 1, 2003, or on June 1 of any
rear thereafter pursuant to the redemption schedule hereafter
;et out, at the principal amount thereof, plus accrued
.nterest thereon to date fixed for redemption and payment,
jithout premium.
As and for a sinking fund for the retirement of the
londs maturing June 1, 2008, but subject to the provisions of
:he next paragraph of this Section, the rent payments
;pecified in the Supplemental Lease which are to be deposited
.n the Principal and Interest Payment Account commencing on
rune 1, 2003, (the "Sinking Fund Deposits"), shall. be
;ufficient to redeem (after credit as hereinafter prov-..ded)
snd the City hereby agrees to redeem the following principal
imounts of Bonds maturing June 1, 2008, on June 1 in each of
:he following years:
YEAR PRINCIPAL AMOUNT
2003
$ 50,000
2004
55,000
2005
60,000
2006
65,000
2007
70,000
(Leaving $75,000 to mature June 1, 2008)
'he Bonds maturing on June 1, 2002 and June 1, 2008, to be
,edeemed and paid pursuant to the operation of the Sinking
'und shall be selected by lot by the Fiscal Agent in such
!quitable manner as it may designate. 'The Fiscal Agent :shall
!ach year in which the Bonds are to be redeemed pursuant to
:he terms of said Sinking Fund make timely selection of Bonds
:o be so redeemed and shall give notice thereof as providod in
:his Ordinance without further instructions from the City or
:he Tenant.
The Fiscal Agent may, at any time after June 1, :1998,
n the case of Bonds maturing in 2002 and on or after June 1,
003 in the case of Bonds maturing in 2008, upon instructions
rom the Tenant use moneys on hand in the Principal and
nterest Payment Account to purchase Bonds maturing on June 1,
002 or June 1, 2008, respectively, in the open market at a
rice not in excess of the then applicable redemption price
pecified above in subsection (b) of this Section and each
and so purchased shall be credited at 100% of the principal
mount thereof on the obligation of the City on the next
inking Fund redemption date for such Bonds and the principal
mount of Bonds to be redeemed by operation of the Sinking
und shall be reduced accordingly.
At its option, to be exercised: (a) with respect to
:he Bonds maturing June 1, 2002, on or before the Forty—fifth
45th) day next preceding any June 1 in the years 1998 to
—14—
1
11
001, inclusive or with respect to the Bonds maturing June 1,
008, on or befor the Forty-fifth (45th) day next preceding
ny June 1 in the years 2002 to 2007, inclusive, the City or
he Tenant may: (i) deliver to the Fiscal Agent for
ancellation, any of such Bonds maturing on June 1, 2002 or
une 1, 2008, as the case may be, in any aggregate principal
mount desired; or (ii) furnish the Fiscal Agent with funds
ogether with appropriate instructions, for the purpose of
urchasing any of said Bonds maturing on June 1, 2002 or June
2008, from any owner thereof whereupon said Fiscal Agent
hall expend such funds for such purpose to such extent as may
e practical; or (iii) receive a credit in respect to the
inking Fund obligation of the City under the second preceding
aragraph of this Section for any Bonds maturing on June 1,
002 or June 1, 2008, as the case may be, which prior to such
`ates have been redeemed (other than through the operation of
.he Sinking Fund requirements of the second preceding
paragraph) and cancelled by the Fiscal Agent and not
:heretofore applied as a credit against any redemption
obligation under said paragraph. Each Bond maturing on June
11 2002 or June 1, 2008, as the case may be, so delivered or
►urchased or previously redeemed shall be credited at 100% of
:he principal amount thereof on the obligation of the issuer
in such redemption date, and any excess of such amount shall
ie credited on future Sinking Fund obligations for such Series
►onds in chronological order and the principal amount of Bonds
:o be redeemed by operation of the Sinking Fund shall be
accordingly reduced.
If the City or the Tenant intends to exercise the
ption granted by the provisions of sub -provisions (i), (ii)
r (iii) of the next preceding paragraph, the City or the
enant will on or before the Forty-fifth (45th) day next
receding each June i in the years from 1998 to 2003,
nclusive, with respect to the Bonds maturing June 1, 2004,
end on or before the Forty-fifth (45th) day next preceding
!ach June 1 in the years from 2002 to 2007, inclusive, with
-espect to the Bonds maturing June 1, 2008, inclusive, furnish
:he Fiscal Agent with a certificate signed by its President or
�n appropriate officer of the Tenant indicating to what extent
:he provisions of said sub -provisions (i), (ii) and (iii) are
.o be complied with in respect to such Sinking Fund payment.
If called for redemption, this Bond will cease to
year interest on the specified redemption date provided funds
.or such redemption are on deposit with the Paying Agent prior
.o the redemption date. Notice of the call for any redemption
irovided for by the Bond Ordinance shall be given by
-egistered or certified mail to the registered owner thereof
t the address shown on the registration books of the Fiscal
gent not less than Thirty (30) days prior to the redemption
late; provided, however, that failure to give such notice by
sailing as aforesaid, or any defect therein, shall not affect
:he validity of any proceedings for the redemption of this
ond.
-15-
n
This Bond shall not be valid or binding on said City
ntil this Bond shall have been authenticated by the execution
y the Fiscal Agent of the Certificate of Authentication
lereon.
(FORM OF ASSIGNMENT)
For value received, the undersigned hereby sells,
ssigns and transfers unto
Print or Type Name and Address of Transferee
he within Bond and all rights thereunder, and hereby
uthorizes the transfer of the within Bond on, the books kept by
he Fiscal Agent for the registration and transfer of Bonds.
ated:
NOTICE: The signature to this
assignment must correspond
with the name as it appears
upon the face of the within
Bond in every particular. j
Signature Guaranteed By:
By j
Title.
ss. s v. s o= = ss ss ess sssssssssss= ss ss sss a s ssssss asssss s s s a. _ _ =ss s
—16—
1
l
Form of Bond Counsel's Approvinca Opinion
Bond Counsel's approving opinion with respect to the
uthorization and issuance of the Bonds shall be substantially
n the following form, with such modifications, amendments or
dditional provisions as Bond Counsel shall approve:
I, the undersigned, City Clerk of the City of Salina,
ansas hereby certify that the following is a true and correct
opy of the complete final legal opinion of Hinkle, Eberhart,
lkour* & Jensen, Wichita, Kansas, Bond Counsel, on the within
and afid the series of which said Bond is a part, except that
t omits the date of such opinion, that said legal opinion was
anually executed and was dated and issued as of the date of
elivery of and payment for such Bonds, and is on file with
first Bank and Trust Company, Salina, Kansas.
(facsimile signature)
City Clerk of the City of
Salina, Kansas
-17-
1
I�
1
HINKLE, EBERHART, ELKOURI & JENSEN
Attorneys at Law
125 North Market, Suite 1250
Wichita, Kansas 67202
We have acted as Bond Counsel in connection with the
ssuance by the City of Salina, Kansas (the "City"), of its
ndustrial Revenue Bonds, Series 1987 (Salina Presbyterian
nor,�Inc.), dated April 1, 1987 in the aggregate principal
mount of $800,000 (the "Bonds"). The Bonds are issuable in
he form of fully registered bonds in the denomination of
5,000 or any integral multiple thereof, not exceeding the
rincipal amount of the Bonds maturing on any Principal Payment
ate. The Bonds will mature on June 1 of each year in the
espective principal amounts, and will bear interest from their
ffective date of registration payable to the registered owners
hereof semiannually on December 1 and June 1 of each year at
he respective -rates per annum, as follows:
SERIAL BONDS
Maturity
Principal
Interest
June 1
Amount
Rate
1989
$ 20,000
5.90%
1990
20,000
6.00%
1991
20,000
6.25%
1992
25,000
6.50%
1993
25,000
6.70%
1994
25,000
6.80%
1995
30,000
6.90%
1996
30,000
7.00%
1997
30,000
7.15%
1998
35,000
7.25%
TERM BONDS
2002 165,000 8.00%
2008 375,000 8.25%
The principal of and interest on the Bonds are payable
t the principal office of First Bank and Trust Company, in the
ity of Salina, Kansas (the "Fiscal Agent"). The Bonds are
ubject to redemption and payment prior to maturity upon the
erms and conditions and at the redemption prices set forth in
he Ordinance.
The Bonds have been authorized and issued under and
ursuant to K.S.A. 12-1740 et seq., as amended (the "Act") and
he Ordinance hereinafter referred for the purpose of providing
unds to pay the costs of acquiring, purchasing, constructing
nd installing an addition to an existing Facility described in
he Ordinance (the "Facility").
—18—
We have examined a certified transcript of proceedings
re ating to the authorization and issuance of the Bonds, which
tr nscript includes, among other documents and proceedings, the
fo lowing:
(i) Ordinance adopted by the governing body
of the City on April 20, 1987 .
(ii) Supplemental Lease Agreement dated as
,of April 1, 1987 (the "Supplemental Lease"),
'between the City and Salina Presbyterian Manor,
Inc., a Kansas not—for—profit corporation (the
"Tenant").
(iii) Guaranty Agreement dated as of April 1,
1987 (the "Guaranty Agreement"), among the
Tenant, Salina Presbyterian Manor, Inc., a Kansas
not—for—profit corporation, and United
Presbyterian Foundation of Kansas, the
("Guarantors") and the Fiscal Agent for the
benefit of the owners of the Bonds.
We also have examined the Constitution and statutes
of the State of Kansas, insofar as the same relate to the
au horization and issuance of the Bonds and the authorization,
ex cution and delivery of the Ordinance, the Supplemental
Le se and the Guaranty Agreement, and an executed and
au henticated Bond of the issue so authorized.
Based upon such examination, we are of the opinion,
as of the date hereof, as follows:
1. The City is a municipal corporation duly and
legally organized and validly existing under the laws of the
State of Kansas, and has lawful power and authority to issue
the Bonds and to enter into the Ordinance and the Supplemental
Lease and to perform its obligations thereunder.
2. The Bonds are in proper form and have been duly
a horized and issued in accordance with the Constitution and
s tutes of the State of Kansas, including the Act.
3. The Bonds are valid and legally binding limited
ot
igations of the City
according to the
terms thereof,
pa
able as to principal,
redemption premium,
if any, and
i r
erest solely from, and
secured by a valid
and enforceable
PI
dge and assignment of
the rents, revenues
and receipts
dE
ived by City under the
Supplemental Lease
(except to the
e
ent payable from proceeds
of the Bonds, insurance proceeds,
s
e or condemnation awards or payments, if
any, received
. p
suant to the Guaranty
Agreement), all
in the manner
provided in the Ordinance. The Bonds do not constitute a debt
of the City, the State of Kansas or any political subdivision
ttereof and do not constitute an indebtedness within the
mEaning of any constitutional or statutory debt limitation or
—19—
restriction, and are not payable in any manner by taxation.
Interest on the Bonds is not an item of tax
p eference for purposes of the individual minimum tax.
H Wever, the Code includes interest on certain obligations,
s ch as the Bonds, in the adjusted net book income of certain
c rporations for taxable years after 1986 and would include in
t e calculations of alternative minimum taxable income 50% of
t e excess of the corporation's adjusted net book income over
i s pre—book alternative taxable income (determined without
r gard to this adjustment and prior to reduction for certain
n t operating losses).
—20—
GL
4. The Ordinance, the Supplemental Lease and the
aranty have been duly authorized, executed and delivered by
tf
e parties thereto, and constitute valid and legally binding
ac
reements of the parties thereto, enforceable in accordance
with
the respective provisions thereof.
5. Under existing law, the interest on the Bonds is
exempt
from Federal income taxation, subject to certain
limitations
and exceptions as set forth below.
i
The Internal Revenue Code of 1986 (the "Code") has
made
a number of recent changes in the United States income
t
x laws relating to tax exemption obligations of state and
ld
cal governments. These changes are generally applicable to
t
e Bonds. The City and the Tenant have covenanted to take
st,ch
actions as may be required in order to comply with the
p
ovisions of the Code. The failure of the City and the
To
nant to comply with such covenants could adversely affect
tie
tax exempt status of the Bonds. Among other requirements,
(
) at least 95% of the proceeds of the Bonds must be used by
n
person other than a Section 501(c)(3) organization or a
g
vernmental unit; (2) not more than 5% of the proceeds of the
B
nds can be used directly or indirectly in any unrelated
t
ade or business; (3) the amount of bond proceeds which may
b
used to finance the costs of issuance of the bonds may not
e
Geed 2% of the face amount of the issue; (4) the outstanding
t
x—exempt bonds allocated to the Tenant and certain related
o
ganizations may not exceed $150,000,000; (5) the average
m
turity of the Bonds may not exceed 120% of the .average
r
asonably expected economic life of the facilities financed
w
th the net proceeds of the issue; (6') none of the proceeds
o
the Bonds may be used to provide any airplane, skybox or
o
her luxury box, gambling facility, or store for the sale of
a
coholic beverages; (7) the issuance of the Bonds must have
b
en approved after a public hearing following reasonable
p
blit notice; (8) certain excess investment earnings must be
p
riodically calculated and rebated to the United States; (9)
t
e Bonds may not in any other respect constitute "arbitrage
b
nds" as defined in the Code; and (10) the City must comply
w
th requirements to respond certain information concerning
t
e Bonds to the Treasury Department.
Interest on the Bonds is not an item of tax
p eference for purposes of the individual minimum tax.
H Wever, the Code includes interest on certain obligations,
s ch as the Bonds, in the adjusted net book income of certain
c rporations for taxable years after 1986 and would include in
t e calculations of alternative minimum taxable income 50% of
t e excess of the corporation's adjusted net book income over
i s pre—book alternative taxable income (determined without
r gard to this adjustment and prior to reduction for certain
n t operating losses).
—20—
-21-
Furthermore, under the provisions of the Code,
pr
perty and casualty insurance companies are required for
to
th
able years beginning on or after January 1, 1987, to reduce
amount of their deductible underwriting losses by a
pe
centage of the amount of tax exempt interest received or
ac
rued on obligations acquired after August 7, 1986.
In addition, the Code provides that banks and thrift
in
titutions will be unable to deduct any portion of the
in
Brest cost of purchasing or carrying tax exempt obligations
(w
th curtain exceptions described below) if such interest
co
is ar,e incurred in taxable years ending after December 31,
19
1,6 with respect to bonds acquired after August 7, 1986. The
Co
a further provides that certain "qualified tax exempt
ob
igations" will be treated as having been acquired on August
7,
1986. The City has designated the Bonds as "qualified tax
ex
mpt obligations" as described above.
H.R. 2005, the Superfund Amendments and
Re
uthorization Code of 1986, includes among its provisions
th
imposition of a new environmental tax, which is based
ge
erally on a percentage of corporate alternative minimum
to
able income, including interest on tax exempt obligations
su
h as the Bonds. The tax is imposed whether or not the
to
payer is subject to the alternative minimum tax, and is
effective
for taxable years beginning 1991. The imposition of
th
s environmental tax could result in additional taxes on
in
erest on the Bonds for certain corporate bondowners.
6. Under existing law the interest on the Bonds is
exempt
from income taxation by the State of Kansas and the
Bonds
are exempt from intangible personal property taxes
levied
by Kansas counties, cities and townships.
The rights of the owners of the Bonds and the
en
orceability of the Bonds, the Supplemental Lease and the
Gu
ranty may be subject to bankruptcy, insolvency,
re
rganization, moratorium and other similar laws affecting
cr
ditor's rights heretofore or hereafter enacted and their
en
orcement may be subject to the exercise of judicial
di
cretion in accordance with general principles of equity.
We have not participated in the preparation of the
Official
Statement relating to the Bonds and express no
o
'nion regarding the accuracy or sufficiency of other matters
co
tained therein, except as respects the paragraphs entitled
"
dinance", "Supplemental Lease" and "Guaranty Agreement".
This
opinion does not extend to documents, agreements,
re
resentations or other materials of any kind concerning the
Bolds
not specifically mentioned herein and should not be
colsidered
as inclusive of any matters which are not set forth
he
-Bin.
HINKLE, EBERHART, ELKOURI & JENSEN
-21-
SECTION 10. Authentication, Execution and Delivery of
t je Bonds. The Mayor and City Clerk are hereby authorized and
directed to prepare and execute the Bonds herein authorized, in
the manner hereinbefore specified, and to obtain its
a thentication by the Fiscal Agent and to cause said Fiscal Agent
to deliver said Bonds to the purchaser thereof, on payment of the
purchase price therefor. The Fiscal Agent shall authenticate
s id Bonds in the principal amount of $800,000 and deliver the
s e as provided above.
SECTION 11. Designation of Fiscal Agent. First Bank
arid Trost Company, in the City of Salina, Kansas, is hereby
designated as the City's Fiscal Agent under the provisions of
this Ordinance and of said Supplemental Lease, and the proceeds
of' the said Bonds shall be deposited with said Fiscal Agent.
SECTION 12. -Maintenance of Prior Funds and Accounts.
The Construction Fund, Principal and Interest Account and Bond
Reserve Account created by Ordinance No. 8639 shall be held and
maintained by the Fiscal Agent and administered and invested in
accordance with the provisions of said Ordinance No. 8639. The
m nthly deposits in the Bond Reserve Account as set forth in
0 dinance 8639 shall continue and the minimum amount which may be
h ld in the Bond Reserve Account shall be increased to $240,000.
SECTION 13. Disposition of Bond Proceeds. The
p oceeds of the Bonds (including accrued interest to the date of
issuance and delivery of the Bonds) shall be applied by the
Fiscal Agent as follows:
(a) The Fiscal Agent shall deposit to the credit
o the Principal and Interest Account the accrued interest to the
d to of issuance and delivery of the Bonds.
(b) The Fiscal Agent shall next deposit to the
C nstruction Fund the balance of the proceeds of the Bonds.
SECTION 14. Bonds Equally Secured Under Ordinance No.
8 39. Except as to differences in the maturates thereof, in the
r tes of interest, the provisions for redemption, the Bonds
a thorized herein shall be on a parity with and shall be entitled
t the same benefit and security of Ordinance No. 8639 and the
1 78 Bonds issued thereunder. Except as specifically provided
h rein and to the extent permitted by Ordinance No. 8639, the
B nds herein authorized is and shall be governed by all of the
P ovisions of Ordinance No. 8639, including, without limitation,
t e provisions with respect to the collection and disposition of
r venues, the covenants of the City, the nature and extent of the
s curity for the Bonds, the City's right to issue additional
b nds, the rights, duties and obligations of the City, the rights
o the owners of the Bonds, and the provisions relating to
a endments, events of default, the Fiscal Agent and enforcement.
Ir case any provision, covenant, stipulation, obligation or
a reement contained in the Bonds or in this Ordinance shall for
a y reason be held to be in violation of, or contrary to or in
c nflict with the provisions of Ordinance No. 8639 of the City,
—22—
th.n the provisions of this Ordinance shall be deemed to
co trol.
(c) The City hereby authorizes and directs the Fiscal
Ag.nt to act on its behalf with respect to the rebate
r. uirement described in Treas. Reg. 1.103-15AT(d), and the
F' cal Agent consents to the creation of the agency for the
ex ress and limited purpose of complying with such rebate
re uirement. Pursuant to this agency, the Fiscal Agent agrees
to make timely determination and to make timely payments of the
R ate Amount (from funds provided by the Borrower) to the
United States. For purposes of this subsection, the Rebate
AmPunt shall mean the amount equal to the sum of
—23—
SECTION 15. Non—Arbitrage Covenant. (a) The City
co
enants and agrees that it will cause the proceeds of the Bonds
to
be applied as soon as practicable and with all reasonable
di
patch for the purposes for which the Bonds are issued, and the
Ci
y and the Fiscal Agent covenant and agree that no part of the
pr
coeds of the Bonds shall be invested in any securities or
ob
igations except for the temporary period pending such use, nor
us
.d at any time, directly or indirectly, in a manner which, if
su
h use,' had been reasonably anticipated on the date of issuance
of
the Bonds, would have caused any of the Bonds to be or become
"a
bitra:ge bonds" within the meaning of Section 1:03(c) of the
Co
a and the regulations of the Treasury Department thereunder
pr
posed or in effect at the time of such use and applicable to
ob
igations issued on the date of issuance of the Bonds.
(c) The City hereby authorizes and directs the Fiscal
Ag.nt to act on its behalf with respect to the rebate
r. uirement described in Treas. Reg. 1.103-15AT(d), and the
F' cal Agent consents to the creation of the agency for the
ex ress and limited purpose of complying with such rebate
re uirement. Pursuant to this agency, the Fiscal Agent agrees
to make timely determination and to make timely payments of the
R ate Amount (from funds provided by the Borrower) to the
United States. For purposes of this subsection, the Rebate
AmPunt shall mean the amount equal to the sum of
—23—
(b) In the event that any funds (including investment
proceeds)
remain in the Construction Fund or the Bond Reserve
Fund,
on the date six months after the Date of Issue, the City
and
the Fiscal Agent shall limit the investment of Gross Proceeds
in
Non—purpose Obligations as follows: At all times during each
Bo
id Year, the aggregate amount of Gross Proceeds of the Bonds
in
jested in Non—purpose Obligations, the Yield on which is higher
than
the Yield on the Bonds shall not exceed 150% of the Debt
Se
vice on the Bonds for such Bond Year. The aforementioned
liitation
shall be deemed satisfied provided the aggregate
am
unt of Gross Proceeds of the Bonds invested in Non—purpose
Ob
igations the Yield on which is higher than the Yield on the
Bo
d is reduced not later than thirty days after each payment of
p
ncipal which reduces the annual Debt Service on the Bonds as
pr
vided in Treas. Reg. 1.103-15AT(c). For purposes of this
su
section, the aggregate amount of Gross Proceeds of the Bonds
injested
in Non—purpose Obligations shall be determined without
regard
to Gross Proceeds of the Bonds which are invested in
No
—purpose Obligations during the temporary periods described in
Traas.
Reg. 1.103-15AT(c)(2), including but not limited to the
t
ee—year temporary period applicable to certain construction
fulds,
the one—year temporary period applicable to (i) the
reinvestment
of investment proceeds, and (ii) amounts received
f
m the investment of a sinking fund, the thirty—day temporary
pe
iod applicable to amounts accumulated in a sinking fund, and
t
thirteen—month temporary period applicable to bona fide debt
se
vice funds.
(c) The City hereby authorizes and directs the Fiscal
Ag.nt to act on its behalf with respect to the rebate
r. uirement described in Treas. Reg. 1.103-15AT(d), and the
F' cal Agent consents to the creation of the agency for the
ex ress and limited purpose of complying with such rebate
re uirement. Pursuant to this agency, the Fiscal Agent agrees
to make timely determination and to make timely payments of the
R ate Amount (from funds provided by the Borrower) to the
United States. For purposes of this subsection, the Rebate
AmPunt shall mean the amount equal to the sum of
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1
(i) the excess of
(A) the aggregate amount earned from the date of
issue on all Non -purpose Obligations in
which Gross Proceeds of the Bonds are
invested [other than amounts attributable to
the excess described in this clause (i)],
over
(B) the amount that would have been earned if
the yield on such Non -purpose Obligations
[other than amounts attributable to the
excess described in this clause (i)] had
been equal to the Yield on the Bonds,
plus
(ii) any income attributable to the excess
d scribed in clause (i).
T e Rebate Amount shall be calculated as provided in Treas.
R g. 1.103-15AT(d) and paid in accordance with the provisions
o Treas. Reg. 1.103-15AT(e) from payments made under the Lease.
Unless the City makes a written election to the
c ntrary prior to the Date of Issue of the Bonds, the aggregate
a ount earned on a bona fide debt service fund and allocated to
s ch fund, shall not be taken into account in determining the
R bate Amount if the gross earnings on such fund for the Bond
Y ar are less than $100,000 as provided in Treas. Reg.
1 103-15AT(d)(4).
The Rebate Amount shall be deemed equal to zero and
t ere shall be no rebate requirements if all Gross Proceeds of
t e Bond [other than Gross Proceeds held in a bona fide debt
s rvice fund as provided in Treas. Reg. 1.103-15AT(d)(5)] are
e pended for the governmental purpose for which the Bonds are
i sued within six months after the Date of Issue of the Bonds.
(d) The City and the Fiscal Agent shall not make or
a ree to make any payment or participate in any transaction,
tie effect of which is to reduce the Rebate Amount required to
bd rebated to the United States under Treas. Reg. 1.108-15AT(d).
"Bond Year" shall mean the one-year period beginning
ov the day after the expiration of the preceding Bond Year of
the Bond. The first Bond Year of the Bond begins on the Date
o Issue and ends one year later, as described in Treas. Reg.
1 103-15AT(b)(9).
"Costs of Issuance" means any and all expenses of
w atever nature incurred in connection with the issuance and
s le of the Bonds, including but not limited to underwriting
f es and expenses, underwriting discount, bond and other
p inting expenses, and legal fees and expenses of counsel.
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"Non—Purpose Obligations" means any security or any
obLigation [other than an obligation described in Section
103(a) of the Code] in which Gross Proceeds of the Bonds are
injested and which is not acquired to carry out the
gojernmental purpose of the issue, as described in Treas. Reg.
1. 03-15AT(b)(2).
"Debt Service" shall mean the scheduled amount of
shall mean
interest
and amortization of principal payable for that Bond
c
Ye
r, as described in Treas. Reg. 1.103--15AT(b)(5).
of all payments of principal and
"Gross Proceeds" shall mean (i) original proceeds,
to be
(i
) investment proceeds, (iii) transferred proceeds, (iv)
am
unts held in a sinking fund, (v) amounts held in a
as described
reasonably
required reserve or replacement fund, (vi)
se
urities or obligations pledged as securities for payment of
de
)t service on the Bonds by the City (or a related person),
th
Lessor or by a governmental unit of which the City is a
pa
t; (vii) amounts received with respect to acquired purpose
ob
igations, (viii) amounts used to pay debt service on the
Bo
ds and (ix) other amounts received as a result of investing
tit
amounts described hereinabove, as described in Treas. Reg.
1
03-15AT(b)(6).
"Non—Purpose Obligations" means any security or any
obLigation [other than an obligation described in Section
103(a) of the Code] in which Gross Proceeds of the Bonds are
injested and which is not acquired to carry out the
gojernmental purpose of the issue, as described in Treas. Reg.
1. 03-15AT(b)(2).
SECTION 16. Authorization of Supplemental Lease. The
Ma jor and City Clerk are hereby authorized to execute the
S plemental Lease dated as of April 1; 1987, substantially in
t form attached to this Ordinance, including any changes
n essary to correct omissions or ambiguities therein. The
Mi or and City Clerk are further authorized and directed to
e cute and acknowledge an assignment by the City to the Fiscal
Aant of the City's interest in the Supplemental Lease which
a ignment shall be effective to assign to the Fiscal Agent all
ol the City's rights, duties, responsibilities and obligations
urder this Ordinance and the Supplemental Lease excepting only
t se rights, duties, responsibilities and obligations under
ttis Ordinance and the Supplemental Lease which may only be
properly and lawfully exercised by or imposed upon the City.
SECTION 17. Guaranty Agreement. As and for an
e>press condition precedent to the issuance and delivery of the
Bonds, there shall be executed and delivered by Tenant and the
Fiscal Agent a Guaranty Agreement dated as of April 1, 1987,
w ereby Tenant and United Presbyterian Foundation of Kansas
guarantee to the Fiscal Agent for the benefit of the registered
ouiner of the Bonds, the payment of principal of and interest on
the Bonds when and as the same become due and payable.
SECTION 18. Authorization of Bond Purchase
A41reement. The Mayor and City Clerk are hereby authorized to
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"Yield"
shall mean
the yield which when used in
c
puting the
present worth
of all payments of principal and
irterest
to be
paid on the
Bonds produces an amount equal to
the
issue price
as described
in Treas. Reg. 1.103-15AT(b)(3).
SECTION 16. Authorization of Supplemental Lease. The
Ma jor and City Clerk are hereby authorized to execute the
S plemental Lease dated as of April 1; 1987, substantially in
t form attached to this Ordinance, including any changes
n essary to correct omissions or ambiguities therein. The
Mi or and City Clerk are further authorized and directed to
e cute and acknowledge an assignment by the City to the Fiscal
Aant of the City's interest in the Supplemental Lease which
a ignment shall be effective to assign to the Fiscal Agent all
ol the City's rights, duties, responsibilities and obligations
urder this Ordinance and the Supplemental Lease excepting only
t se rights, duties, responsibilities and obligations under
ttis Ordinance and the Supplemental Lease which may only be
properly and lawfully exercised by or imposed upon the City.
SECTION 17. Guaranty Agreement. As and for an
e>press condition precedent to the issuance and delivery of the
Bonds, there shall be executed and delivered by Tenant and the
Fiscal Agent a Guaranty Agreement dated as of April 1, 1987,
w ereby Tenant and United Presbyterian Foundation of Kansas
guarantee to the Fiscal Agent for the benefit of the registered
ouiner of the Bonds, the payment of principal of and interest on
the Bonds when and as the same become due and payable.
SECTION 18. Authorization of Bond Purchase
A41reement. The Mayor and City Clerk are hereby authorized to
—25—
ex.cute the Bond Purchase Agreement with respect to the Bonds,
su stantially in the form attached to this Ordinance, including
an changes necessary to correct omissions or ambiguities
therein.
SECTION 19. Invalidity of Provisions. If any one or
more of the covenants, agreements or provisions of this
Ordinance or of said Supplemental Lease should be held contrary
to the policy of express law, though not expressly prohibited,
or against public policy, or shall for any reason whatsoever be
h el d invalid, then such covenants, agreements or provisions
shall b4 null and void and shall be deemed separate from the
re aininIg covenants, agreements or provisions, and shall in no
waif affect the validity of the other provisions of this
Ordinance or of the Bonds issued hereunder, or the Supplemental
Lease.
SECTION 20. Waiver of Ad Valorem Tax Exemption. The
Bolds of the City as authorized by this Ordinance shall be
is ued upon the express condition that the Tenant will waive
anj ad valorem property tax exemption which would or might
of erwise be available with respect to the Facility under the
prpvisions of K.S.A. 79-201(a) Second, as amended.
SECTION 21. Further Authority. The City shall, and
th officers, agents and employees of the City are hereby
au horized and directed to, take such actions, expend such
fu ds and execute such other documents, certificates and
i truments as may be necessary or desirable to carry out and
comply with the provisions of this Ordinance and to carry out,
comply with and perform the duties of the City with respect to
t Bonds, the Ordinance, the Supplemental Lease and the Bond
Pu chase Agreement all as necessary -to carry out and give
e ect to the transactions contemplated hereby and thereby.
SECTION 22. Effective Date. This Ordinance shall
t e effect and be in full force from and after its adoption by
t Governing Body of the City.
PASSED AND APPROVED by the Governing Body of the City
of Salina, Kansas, this 20th day of April, 1987.
By: ZZ
.//'
ose M. Ritter, Mayor
A est:
D. . Harrison, City Clerk
(Jeal)
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1
1
SCHEDULE I
SCHEDULE I TO ORDINANCE NO. 87-9180 OF
THE CITY OF SALINA, KANSAS AND TO IHE
SUPPLEMENTAL LEASE DATED APRIL 1, 1987,
BY AND BETWEEN SAID CITY AND SALINA
PRESBYTERIAN MANOR, INC. AUTHORIZED BY
SAID ORDINANCE.
FACILITY ADDITIONS
The Facility additions will
five (5) additional duplex
existing facility, which will
—27—
include the construction of
buildings adjacent to the
provide 10 residential units.